Fact based stock research
Transcat (NasdaqGM:TRNS)

US8935291075

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

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Transcat stock research in summary

transcat.com

ANALYSIS: With an Obermatt Combined Rank of 57 (better than 57% compared with investment alternatives), Transcat (Trading & Distribution, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Transcat are low in value (priced high) with a consolidated Value Rank of 3 (worse than 97% of alternatives). But they show above-average growth (Growth Rank of 77) and are safely financed (Safety Rank of 83, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 57, is a buy recommendation based on Transcat's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Transcat exhibits low value (Obermatt Value Rank of 3), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 77). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 83) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	3
Growth Rank	77
Safety Rank	83
Combined Rank	57

Country	USA
Industry	Trading & Distribution
Index	NASDAQ
Size class	Small

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Transcat

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	6	3	6	3
GROWTH
GROWTH	53	61	81	77
SAFETY
SAFETY	31	65	27	83
SENTIMENT
SENTIMENT	n/a	43	77	^new
360° VIEW
360° VIEW	n/a	35	56	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 28-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Transcat is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	6	3	6	3
GROWTH
GROWTH	53	61	81	77
SAFETY
SAFETY	31	65	27	83
COMBINED
COMBINED	35	42	26	57

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Transcat the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 3 (worse than 97% compared with alternatives), Transcat shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Transcat. Price-to-Sales is 15 which means that the stock price compared with what market professionals expect for future profits is higher than 85% of comparable companies, indicating a low value concerning Transcat's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 34, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Transcat. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 7 and Dividend Yield, which is lower than 99% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 3, is a sell recommendation based on Transcat's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Transcat? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Transcat? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Transcat may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	20	23	20	15
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	31	7	5	7
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	8	13	43	34
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	6	3	6	3

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Transcat; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 77 (better than 77% compared with alternatives) for 2024, Transcat shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Transcat. Sales Growth has a value of 80 which means that currently professionals expect the company to grow more than 80% of its competitors. Profit Growth with a value of 86 and Capital Growth with a rank of 50 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 43, which means that stock returns have recently been below 57% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 77, is a buy recommendation for growth and momentum investors. Transcat has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Transcat, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	35	30	78	80
PROFIT GROWTH
PROFIT GROWTH	1	68	59	86
CAPITAL GROWTH
CAPITAL GROWTH	n/a	32	45	50
STOCK RETURNS
STOCK RETURNS	98	95	77	43
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	53	61	81	77

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Transcat.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 83 (better than 83% compared with alternatives) for 2024, the company Transcat has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Transcat is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Transcat. Leverage is at a rank of 83, meaning the company has a below-average debt-to-equity ratio. It has less debt than 83% of its competitors. Liquidity is also good at a rank of 73, meaning the company generates more profit to service its debt than 73% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 32, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 68% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 83 (better than 83% compared with alternatives), Transcat has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Transcat. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Transcat and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	62	70	54	83
REFINANCING
REFINANCING	26	20	14	32
LIQUIDITY
LIQUIDITY	30	73	51	73
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	31	65	27	83

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Transcat and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	60	68	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	23	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	53	48	^new
MARKET PULSE
MARKET PULSE	n/a	68	91	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	43	77	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Transcat.
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